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WWE CFO BREAKS DOWN CONTINUED IMPORTANCE OF INTERNATIONAL MARKETS & TALENTS

By Mike Johnson on 2013-05-17 09:56:15
As noted, WWE CFO George Barrios made a presentation on the company at the JP Morgan teleconference earlier this week. While discussing the company, the international touring was brought up. Barrios explained the importance of WWE continuing to improve their "footprint" internationally:

"About 75% is in the U.S., about 25% outside the U.S., about two thirds of that 25% is in EMEA. So we are very bullish long-term internationally over the last three years because of our concentration in EMEA. The economy has taken its toll. So we haven't seen the growth that we had seen previously.

Some of that is not just international element. It is some of the things that have impacted the company overall like our videogame business, which has struggled over the last couple of years. As THQ struggled, we recently moved that to Take-Two and we’re really excited about the future of that. But the really strong foothold in EMEA, Mexico is one of our -- depending on how many events we do in a year that will be our fifth or fourth largest market in the world and then India.

As I mentioned, before four largest content deals are Raw in the U.S., SmackDown in the U.S., the deal in U.K. and the deal in India. So after cricket in sports entertainment, we’re ahead in India. So we do really good numbers. We’re really excited about the potential there. We don’t do, I mean, we make $0.05 in consumer products today and we have this very rich content deal because our show does well. Obviously, India has got its very unique infrastructure around consumer products and retail but that’s changing.

Our partner in retail is starting to do more in India. So he said to me next year India is going to be a big consumer products, no. Five, six, seven years, I think it will. I mean, as long as the brand stays healthy and we do really well in India."

Barrios also explained the company's strategy when it comes to talents from outside of the United States, noting, "We track ratings across the world and one of the things that you see is when Wade Barrett of English descent is a key storyline contributor, our ratings in the U.K. do better. When one of our Indian superstars is key in storyline, our ratings in India do better. So kind of managing all that is tough. To your question specifically, we talk about it. We don't think today it makes sense because one of the key value propositions, we believe the reason the show travels internationally is because of catchiness of it, the Americana of it."

Barrios also commented on their plans to focus more on India in the next year, noting, "As I mentioned before, great content deal in India because we deliver numbers in India to our partner but nothing in consumer products. So it's somewhat of cognitive dissidence with that. The main reason is India's both retail infrastructure, actually the legal issues of retailers being able to invest. Indian parliament actually just voted a month ago to let foreign investment come in into their retail sector. I think that's a big deal but specifically on your point, we’re trying to do more in India in target. We've opened up an office. We have three people in Mumbai and we work with Mattel to introduce a lower price point action figure, smaller action figures. It’s about per 4 inches as opposed to the six-inch that we had. And we’ve been coming lower. I still think -- and I was talking to, the guy runs CPG for us, Casey Collins. I still think the price point is too high. So, we are still working with Mattel and may be getting that lower, so working that. But we’re starting to do a little bit more in India. Now, they won't be a big number but it’s part of kind of adapting to the marketplace that four-inch action figure."